Background Milk
EMB: 'It is impossible to milk the cost'
Figures released by the European Milk Board (EMB) last week show that German dairy farmers are still producing far below cost price. The umbrella organization has been drawing attention to this almost hopeless situation for some time now. What is the situation in the Netherlands?
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Only 78% of production costs are covered. The October milk price (€34,23 per 100 kilos) was, to be precise, €9,48 lower than the cost price. This problem does not only occur in Germany, the Netherlands, Denmark, Belgium, France and Luxenburg have also been producing well below cost price for years, according to the EMB.
Cost still rising
The Milk Marker Index (MMI) shows how milk production costs in Germany have developed in recent years. Last quarter the MMI was 107, which is a production cost increase of 7 percentage points compared to the base year 2010. For this quarter an MMI of 106 applies, with 2015 as base year.
We'll grab one investigation report from the EMB about the situation in 2017 at hand, to make the situation concrete for the Netherlands. This shows that the cost price for Dutch dairy farmers in 2017 amounted to a total of €47,81 per 100 kilos. The largest cost items are: purchased feed, depreciation and livestock costs incurred during insemination and veterinary care.
The cost price without labor is €34,87 per 100 kilos, which is in line with current milk prices. The labor factor increases the cost price by €9,12. So it can actually be said that a dairy farmer is not rewarded for his work. In other countries there are also large gaps between the cost price and the yields. After 2017, the situation has hardly changed. Last September the EMB organized one milk dumping campaign to draw attention to the low milk price.
Agractie takes action again
Dairy farmers (but also other producers) are increasingly drawing attention to the low yields. It was a theme during, among other things many farmers' protests in several countries last year. Agractie will soon be in action again in the Netherlands. They have announced a campaign in which they will offer agricultural products at 40 'striking locations' throughout the Netherlands for the amount of the average yield for the farmer.
This action will probably take place in March this year. The official date will follow. With this fun campaign, Agractie wants to make consumers aware of the low prices that farmers have to contend with.